Australia NRIs · Dividend Tax
Dividend tax on Indian shares for NRIs in Australia
Dividends from Indian companies are withheld at the non-resident rate before they reach you in Australia — here's the treaty position and how to reclaim any excess.
India-Australia key facts: dividend tax
| Default Section 195 rate | 20% |
| India-Australia DTAA treaty rate | 15% |
| Your saving via the treaty | 5% |
| Treaty article / basis | Article 10 — 15% on Indian-listed dividends to Australian residents |
| Your TRC issuing authority | Australian Taxation Office (ATO) |
Rates reflect India's domestic Section 195 withholding and the India-Australia treaty. Surcharge and cess apply on top where relevant.
How it works on the India side
Since the 2020 shift back to classical dividend taxation, dividends from Indian companies are taxable in the shareholder's hands and the company deducts TDS before paying. For a non-resident the default is Section 195 at 20% (plus surcharge and cess). Whether a treaty rate is available depends on the specific treaty — for many countries the lower dividend rate is written only for companies holding a large stake in the Indian payer, which means individual portfolio investors stay at the domestic rate.
Where a lower individual rate does apply, you claim it with Form 10F and a Tax Residency Certificate lodged with the company or broker, and any quarter withheld at the higher rate before your paperwork was on file is reclaimed through your Indian return. Where no lower rate applies, the dividend still goes on your return, and the real relief sits on your home-country side as a foreign tax credit for the Indian tax already paid.
What changes because you live in Australia
Australian residents are taxed on worldwide income, so this Indian income also flows onto your ATO return, with a Foreign Income Tax Offset (FITO) crediting the Indian tax already paid against your Australian liability. The FITO is capped at the Australian tax that would have applied to that same Indian slice, so if your Indian withholding ran higher, the excess is wasted unless carried forward correctly. One trap most NRIs miss: assets held before you became an Australian resident get a deemed cost base reset to their AUD market value on your arrival day (s.855-45), so using the original rupee cost overstates the gain and overpays Australian tax.
Frequently asked questions
Common questions from Australian NRIs
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Dividend Tax sorted, by an Indian CA who works with Australian NRIs
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